Finance

Front 1

The accountant uses information compiled by the bookkeeper to generate reports on the financial standings of the facility

Back 1

True

Front 2

The entity is a basic concept of accounting under which the nursing facility is regarded as a whole entirely separate from the affairs of the owners managers are other employees. This means that is the owner for instance withdrawals are adds to the front of the facility this transfer must be recorded in the books to reflect effect on it finances

Back 2

Example can I draw out funds to purchase a personal computer for daughter in college

Front 3

Full disclosure concept means that all financial information all money spent earned invested are old by the facility must be shown in the financial records to represent accurly its financial standings

Back 3

Example administrator can advise bookkeeper against documenting overtime worked on weekends

Front 4

Consistency concept requires that the accounting reports for the facility be prepared in the same way from year to year in order to compare accurately the reports between two or more different time periods

Back 4

This suggest that the method of reporting be carefully selected and that the changes occur infrequently if at all

Front 5

Time period concept : Is an interval covered by the financial reports usually one year accounting. should be consistent from one year to the next that is the fiscal year the 12 month period designated for financial record keeping

Back 5

It should be in on the same date every year

Front 6

The objective evidence concept requires accounting records to be prepared with the document records that is kept by the facility every transaction should be accompanied by a document record that is a piece of paper that confirms it

Back 6

These pieces of paper are equivalent electronic information are the objects evidence of the transaction receipts bills etc

Front 7

Receipts for bills paid our invoices for money owed by the facility bank statement indicating intrest earn periodically are known as source documents of transaction

Back 7

true

Front 8

In cash accounting expenses are recorded when the cash is actually distributed and revenues are recorded when the money ,for example, resident services is received by the facility

Back 8

Thus the cash system of accounting simply record expenditures in receipts the actual flow of cash out of an into the facility as they occur

Front 9

Under the accrual system of accounting revenues are recorded when they are earned and expenses when they are incurred

Back 9

this happens regardless of the time the cash transactions take place.

Front 10

The financial statements are a summary of the nursing facilities financial well-being within a time.

Back 10

Truth

Front 11

A chart of accounts is a list containing every account in the facility

Back 11

Normally maintained by the bookkeeper

Front 12

Assets are things owned by the facility

Back 12

True

Front 13

Liabilities are things owed by the facility or its obligations

Back 13

True

Front 14

Capital is money invested into the facility also known as the facility's net worth

Back 14

True

Front 15

Journals: the first place that transactions are recorded they are the books of original entry

Back 15

All transaction should be recorded in the journals

Front 16

The Accounts Payable journal or purchase journal records all purchases that will be paid within the next few months

Back 16

True

Front 17

In double entry bookkeeping for each transaction two entries are made in the appropriate journal a debit and credit

Back 17

true

Front 18

The general journal records transactions that do not properly fit into any of the journals. it is used to make adjustments in the books to conform to the accrual system of accounting.

Back 18

example: six month supply of provisions would be entered in the general journal

Front 19

The general ledger can be thought of as summary all debits and credits contained in the journals for the time period.

Back 19

it usually has a page for each account in the chart of accounts.

Front 20

The income statement shows the ending balance of revenue and expense accounts. the balance sheet summarizes the assets liabilities and capital accounts for the facility

Back 20

true

Front 21

The balance sheet summarizes the assets liabilities and capital account of the facility. This document is called a balance sheet because the asset accounts must balance with the liability and capital accounts

Back 21

True

Front 22

Current assets are those that can be liquidated it turned into cash within 12 months

Back 22

True

Front 23

Historic cost concept is a basic tenet of accounting and relates to the on going concern concept: since capital assets will not be liquidated anytime soon market value is of little relevance

Back 23

True

Front 24

Depreciation is an expense associated with the use of an asset

Back 24

True

Front 25

The accounting period is the interval covered by the financial reports usually one year

Back 25

ex: administrative knows that there are six hundred thousand in notes payable on the financial reports she knows that these must be paid within one year

Front 26

A ratio analysis allowed the administrator to identify trends in many of the financial performance of the facility by comparing the same ratio for several. Ratio analysis of financial statements can also be used to compare the financial performance of several facilities

Back 26

When the chief financial officer identifies trends and measures of the facilities financial performance by comparing the same relationship for several time. periodsHe is doing a ratio analysis

Front 27

The current ratio is current assets divided by current liabilities

Back 27

ex: current assets 403,898÷ 367,000=
1.1

Front 28

Average collection period equals accounts receivable divided by net operating revenues

Back 28

ex: 105,800÷334,000=

Front 29

There's several tools available to assist the ministry to controlling financial operations to see this should be a rain so that no single person have complete responsibility for any area of the facilities finance.

Back 29

A system of checks and balances can be established so that part of one person's task is completed our review by another

Front 30

A perpetual inventory system is recommended to maintain a precise count of inventory on hand that is an accurate count of supplies used in those remaining in the store room

Back 30

true

Front 31

The largest directly controllable cost for the average administrator is

Back 31

Labor

Front 32

a method for measuring the potential profitability of an investment, calculated by dividing g the net income by the investment is the ARR (accounting rate of return)

Back 32

true

Front 33

change in accounting estimate is a revision of an accounting for cast or assumption about the facility's expected or experienced performance.

Back 33

true

Front 34

Return on investment capital

Back 34

true

Front 35

price controls- the use of government power to keep prices above or below the equilibrium.

Back 35

to keep n it above is setting a price floor. to keep it below is setting a price ceiling.

Front 36

short term securities

Back 36

used for short term working capital

Front 37

bonds

Back 37

true

Front 38

LC

Back 38

true